Buying a beachfront apartment in Florianópolis or a house in Jurerê is, for many foreigners, the easy part. The question almost no one asks at the notary is the one that matters most in the long run: what happens to that property when the owner dies? The answer surprises anyone from a common law background: a property located in Brazil is governed by Brazilian law, with a Brazilian probate and forced heirs, no matter where the owner lived or what a foreign will says.
This article is general information to orient foreign buyers and investors. It is not legal or tax advice. Succession is a technical field and every family is different: before you decide, consult a succession lawyer and an accountant licensed in Brazil.
1. Which law applies? A Brazilian property is governed by Brazil
The starting point is the Code of Civil Procedure. Its Article 23, item II (Lei 13.105/2015) grants Brazilian courts, to the exclusion of any other, the probate (inventário) and division of assets located in Brazil, even if the deceased was a foreign national or domiciled abroad. In practice, the Superior Court of Justice (STJ) will not recognise foreign judgments over Brazilian real estate: a probate obtained in Miami or Madrid does not, on its own, transfer an apartment in Florianópolis.
And which substantive law decides who inherits? Article 10 of the LINDB (Decreto-Lei 4.657/1942) says succession is governed by the law of the deceased's last domicile. But its §1, together with Article 5, XXXI, of the Constitution, protects a Brazilian spouse and children: for assets located in Brazil, Brazilian law applies whenever it is more favourable to them. Add the saisine rule of Article 1,784 of the Civil Code —the estate transfers to the heirs at the very moment of death— and the result is clear: a Brazilian property runs through the Brazilian succession system.
2. Forced heirship: half belongs to the compulsory heirs
Brazil limits testamentary freedom. Article 1,845 of the Civil Code defines the compulsory heirs (herdeiros necessários): descendants, ascendants and the spouse. Article 1,846 reserves for them, by right, half of the estate: that half is the legítima. The testator may freely dispose of only the other half, the available portion.
For a foreign owner this means two things. First, a will that leaves everything to a single person —perhaps valid in their home country— cannot override that reserved share for the Brazilian property. Second, nationality does not discriminate: foreign heirs inherit on the same footing as a Brazilian and, within the same class, in equal shares. Being a child or spouse counts; the passport does not.
3. ITCMD in Santa Catarina: now progressive
Inheritance —and also a lifetime gift— pays the ITCMD, a state transfer tax. Santa Catarina changed its rules: State Law 19.053/2024 (published on 18 Sept 2024) revoked the old flat 8% rate and replaced it with a progressive table, applied by bracket on the market value of the asset and valid for both herança (inheritance) and doação (gift), with no distinction by degree of kinship:
| Tax base (market value) | Rate |
|---|
| Up to R$ 20,000 | 1% |
| R$ 20,000.01 to R$ 50,000 | 3% |
| R$ 50,000.01 to R$ 150,000 | 5% |
| Above R$ 150,000 | 7% |
Because the tax is progressive by bracket, each slice of value is taxed at its own rate. In Florianópolis, however, most properties comfortably exceed R$ 150,000, so the bulk of the value falls in the 7% band and the effective rate approaches that ceiling. The change follows the national tax reform, which pushes the states toward a progressive ITCMD.
4. Probate when the heirs do not live in Brazil
No property passes to the heirs without an inventário, the procedure that settles and divides the estate. It can be judicial or extrajudicial (by public deed at a notary's office); the faster notarial route requires heirs who are of age, in agreement and —as a rule— with no will and no minors involved.
Living abroad does not prevent you from taking part. A non-resident heir usually acts through an attorney-in-fact in Brazil, under a power of attorney granted at a Brazilian consulate or notarised and apostilled (Hague Convention). Each heir will also need a CPF (Brazilian taxpayer number) and a sworn translation of the foreign documents. The ITCMD must be paid before the division is closed and the property is registered in the heirs' names. Timelines vary: a simple extrajudicial inventário may resolve in a few months, while a judicial or disputed one takes considerably longer.
5. Individual ownership or a holding company?
Many foreigners buy the property in their own name (persona física). It is the simplest and cheapest option at the outset, but when the owner dies the full weight lands on that asset: probate, ITCMD and forced heirship apply directly to the property.
The alternative: an asset-holding company
The other route is to contribute the properties to a holding company (usually a limited-liability company) and have the heirs receive quotas (shares) in it. Among the advantages often cited: centralised management and clear succession rules; the ability to gift quotas during your lifetime while reserving a usufruct, planning and organising the transfer in advance; potentially lower tax on rental income at the corporate level; and, in certain cases, ITBI immunity when the property is contributed to the company's capital.
But it is no magic formula. That ITBI immunity is lost if the company's preponderant activity is real estate (Article 37 of the National Tax Code). Setting up and maintaining a holding costs money and accounting discipline; moving assets from the individual to the company is not tax-neutral; and —crucially— a holding does not erase the legítima or eliminate the ITCMD: it only changes when and how they are paid. For a non-resident there are extra steps: registration of the foreign capital with the Central Bank (RDE-IED) and a representative or manager resident in Brazil. The new national ITCMD rules from the tax reform also affect holdings, so the calculation is worth redoing with current figures.
Before you decide
The practical takeaway is sober: your Floripa property will live and be inherited under Brazilian law, and planning ahead spares the family a costly, lengthy, long-distance process. None of the above replaces professional analysis. Consult a succession lawyer and an accountant licensed in Brazil before signing wills or gifts or setting up a corporate structure.
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